Vistra Energy (VST) Stock Forecast & Price Target

Vistra Corp. has demonstrated strong operational performance, reflected in a 9% year-over-year increase in retail volumes to 67 terawatt-hours, showcasing growth in customer demand. The company is also targeting an improvement in its free cash flow conversion rate to at least 60% of adjusted EBITDA by 2026, indicating a commitment to financial health and cash generation. Furthermore, an enhanced hedge percentage, which has risen to 94% for 2026, coupled with expanded retail margins due to its hedging program and effective commercial optimization, underscores Vistra's robust risk management and profitability potential in the energy sector.

Vistra Corp.'s leverage ratio has remained steady at approximately 3.0x, but forecasts indicate a significant decline starting in 2026, raising concerns about future financial flexibility. The company's generation segment experienced a 5% year-over-year decrease in EBITDA, largely due to unplanned outages, which may signal risks to operational reliability and overall profitability. Additionally, the retail segment's EBITDA fell by $33 million amid changing supply costs, suggesting potential vulnerability to market fluctuations that could further constrain free cash flow per share, particularly if gas prices revert to lower historical levels.